Housing in Southern Africa May 2016

Infrastructure & Mixed Use

the City’s budget

D e Lille says these figures are well below the necessary 8% of annual growth needed to generate employment andwell below the official targets of the National Development Plan (NDP). The BER has forecast the Consumer Price In- dex (CPI) to be above the 6% upper inflation target range for the next two years. With the decline of the rand against the US$ over the past three years, business confidence in South Africa’s national government has dipped. This economic picture has a direct bearing on thewaymunicipalities are funded in terms of grants received from the national budget. For instance, says de Lille, Treasury expects municipalities to spend at least 40% renewing infrastructure from their capital budget, Cape Town currently spends 48% on infrastruc- ture projects. Treasury suggests that municipali- ties implement austerity measures, which includes cutting costs such as catering, entertainment, public func- tions and travel. This is something Cape Town initiated years ago. De Lille is proud of the fact that the city provides generous allowances to the poor, more than Treasury’s recommendations. “This forms part of the city’s social obligation,” she says, “We ensure the funding of the programmes in the Integrated De-

The City of Cape Town Executive Mayor, Patricia de Li l le says that are currently sitting at a growth rate of around 1% per annum, while the Bureau of Economic Research (BER) projects an average of 1,6% average growth over three years.

• Refuse removal costs have come down to 7,92% – compared with 8,33% in the previous year • Sanitation costs have been cut to 9,75% from 11% last year • Water services have also been cut to 9,75% from 11% last year • Electricity costs on average of 7,78%, (6,6% for domestic supply) compared to 10,82% last year Additional projects include: • Road Congestion Relief Pro- gramme • Park facility upgrades • Cemetery development • Development of the Hanover Park Aqua Centre • CCTV infrastructure network • Firearms for safety and security services • Project EPIC • Acquisition of new fire engines

velopment Plan (IDP) are in line with taxation targets. In the past two years, we changed our planning method- ology, by introducing an effective Project Portfolio Management (PPM) system. This year we added a screen- ing criteria for budget submissions on new projects.” De Lille continues, “Spatial plan- ning measures encourages Transit- Oriented Development (TOD) and Integrated Human Settlements in line with the city’s Built Environ- ment Performance Plan (BEPP). This includes the provision of basic service infrastructure and integrated invest- ment programmes, and how budget proposals enables economic growth and contribute to identify catalytic projects. These submissions led to the careful consideration of depart- mental inputs against a broader strategy framework, providing crite- ria to inform decision-making.” The proposed rates and tariff structures: • Rates have been reduced by 6% – this is down from 10% last year

May 2016